“So there’s a very good chance that within a few weeks people will be selling fuel at £1.01, and then the temptation to move that extra penny or so will be unavoidable”, he said.
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Despite rumours circulating this morning that prices will fall by the end of the year, said the AA, stressing that anywhere it did occur would be as a “marketing gimmick”.
“Although the price of oil is back into the low $40s, a surge to $50 a barrel a fortnight ago (based on a five-month-old report from China’s central bank) illustrates the continued volatility in the market”.
Russian production is at record levels as it attempts to maximise revenues from losses to income through economic sanctions imposed by the West for its actions in Ukraine.
A warm autumn in both the United States and Europe has also been credited with pegging oil costs down – with a recent note by Goldman Sachs indicating that prices could halve if warmer weather persists in the current market climate.
RAC fuel spokesman Simon Williams said: “Events in Paris made oil traders react on Monday causing a sudden dip in the price of Brent crude to the $40 mark which has not been seen for more than six years”.
A postcode lottery remained, though, with supermarkets generally offering the cheapest fuel.
The RAC expects fuel prices to be reduced by 2p-per-litre in the coming weeks, with more price cuts on the way as global fuel prices experience a new round of reductions.
Earlier this week the Carlyle Group-owned firm asked oil companies to pass on the recent drops to consumers. “In short, United Kingdom drivers should make the most of lower pump prices while they last”.
The last time petrol prices were that low was in the summer of 2009, according to the RAC.
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The average petrol price is now at £1.07 per litre, but prices are already as low as £1.03 in a few places.
